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| homepage = http://www.prepaidlegal.com
| homepage = http://www.prepaidlegal.com
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'''Pre-Paid Legal Services, Inc.''' ({{nyse|PPD}}) is a corporation that offers specialized insurance and legal service products in the United States and Canada. The firm was founded on August 8, 1972, it made its [[initial public offering]] in 1984. Pre-Paid Legal Services, Inc. is a member of the [[S&P 600]] SmallCap index and the [[S&P 1500]] Super Comp index.
'''Pre-Paid Legal Services, Inc.''' ({{nyse|PPD}}) is a corporation that offers specialized legal service products in the United States and Canada. The firm was founded on August 8, 1972, and made its [[initial public offering]] in 1984. Pre-Paid Legal Services, Inc. is a member of the [[S&P 600]] SmallCap index and the [[S&P 1500]] Super Comp index.


==Company description==
==Company description==
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[[File:AdaOK 15AUG2010 PrePaidLegal (2).JPG|thumb|left|250px|Pre-Paid Legal Headquarters]]
[[File:AdaOK 15AUG2010 PrePaidLegal (2).JPG|thumb|left|250px|Pre-Paid Legal Headquarters]]


On July 11, 1969, former CEO and founder Harland C. Stonecipher was involved in a motor vehicle accident and was hospitalized. Although the other party was cited for fault, they had filed a suit against him for the accident.<ref>{{cite web|url=https://www.prepaidlegal.com/newCorp2/press_room/executive_bios.html |title=Pre-Paid Legal Services, Inc. &#124; Executive Bios |publisher=prepaidlegal.com |accessdate=2010-03-07}}</ref> He hired a lawyer to defend himself in court, but in doing so, depleted his life savings. After researching the industry of European legal expense plans, Stonecipher created Pre-Paid Legal’s predecessor, The Sportsman’s Motor Club, on August 8, 1972. The club offered legal expense reimbursement to its members. Pre-Paid Legal began utilizing network marketing in 1983. Pre-Paid Legal went public on the [[NASDAQ]] National Market System in 1984, and two years later moved to the [[American Stock Exchange]].<ref>{{cite web|url=https://www.prepaidlegal.com/newCorp2/about_us/70-79.html |title=Pre-Paid Legal Services, Inc. &#124; The Pre-Paid Legal Story |publisher=prepaidlegal.com |accessdate=2010-03-07}}</ref>
On July 11, 1969, former CEO and founder Harland C. Stonecipher was involved in a motor vehicle accident and was hospitalized. Although the other party was cited for fault, they had filed a suit against him for the accident.<ref>{{cite web|url=https://www.prepaidlegal.com/newCorp2/press_room/executive_bios.html |title=Pre-Paid Legal Services, Inc. &#124; Executive Bios |publisher=prepaidlegal.com |accessdate=2010-03-07}}</ref> He hired a lawyer to defend himself in court, but in doing so, depleted his life savings. After researching the industry of European legal expense plans, Stonecipher created Pre-Paid Legal’s predecessor, The Sportsman’s Motor Club, on August 8, 1972. The club offered legal expense reimbursement to its members. Pre-Paid Legal began utilizing network marketing in 1983. Pre-Paid Legal went public on the [[NASDAQ]] National Market System in 1984, and is currently listed on the [[B=New York Stock Exchange]].<ref>{{cite web|url=https://www.prepaidlegal.com/newCorp2/about_us/70-79.html |title=Pre-Paid Legal Services, Inc. &#124; The Pre-Paid Legal Story |publisher=prepaidlegal.com |accessdate=2010-03-07}}</ref>

In 1997, after a US [[Federal Trade Commission]] (FTC) investigation, Pre-Paid Legal admitted misleading customers and suspended sales of living trusts.<ref name="crashparty"/>


In 2001, the Wyoming Attorney General issued a press release announcing "When we discovered that Pre-Paid was using prohibited income representations to promote their multilevel marketing program, we warned them that the representations were prohibited by
In 2001, the Wyoming Attorney General issued a press release announcing "When we discovered that Pre-Paid was using prohibited income representations to promote their multilevel marketing program, we warned them that the representations were prohibited by
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On November 19, 2009, Pre-Paid Legal announced that it received a complaint from the [[Federal Trade Commission]]. The proposed draft complaint alleged that Pre-Paid's "ADRS program and related materials violate Section 5(a) of the FTC Act regarding asserted misleading representations, express or implied."<ref>{{cite web|url=http://www.prnewswire.com/news-releases/pre-paid-legal-services-announces-ftc-developments-70524402.html |title=Pre-Paid Legal Services Announces FTC Developments |publisher=Pre-Paid Legal Services date= |accessdate=2009-11-19}}</ref><ref>{{cite web|url=http://www.streetinsider.com/Corporate+News/Pre-Paid+Legal+%28PPD%29+Received+Draft+Complaint+from+FTC+Relating+to+ITSADRS+Program/5127084.html |title=Pre-Paid Legal (PPD) Received Draft Complaint from FTC Relating to ITSADRS Program |publisher=StreetInsider.com |date=2009-11-19 |accessdate=2010-09-26}}</ref>
On November 19, 2009, Pre-Paid Legal announced that it received a complaint from the [[Federal Trade Commission]]. The proposed draft complaint alleged that Pre-Paid's "ADRS program and related materials violate Section 5(a) of the FTC Act regarding asserted misleading representations, express or implied."<ref>{{cite web|url=http://www.prnewswire.com/news-releases/pre-paid-legal-services-announces-ftc-developments-70524402.html |title=Pre-Paid Legal Services Announces FTC Developments |publisher=Pre-Paid Legal Services date= |accessdate=2009-11-19}}</ref><ref>{{cite web|url=http://www.streetinsider.com/Corporate+News/Pre-Paid+Legal+%28PPD%29+Received+Draft+Complaint+from+FTC+Relating+to+ITSADRS+Program/5127084.html |title=Pre-Paid Legal (PPD) Received Draft Complaint from FTC Relating to ITSADRS Program |publisher=StreetInsider.com |date=2009-11-19 |accessdate=2010-09-26}}</ref>

Forbes Magazine again in November of 2010 ranked Pre-Paid Legal Services as number 68 out of the 100 best companies in America.


==References==
==References==

Revision as of 21:53, 12 December 2010

Pre-Paid Legal Services, Inc. & Subsidiaries
Company typePublic (NYSE: PPD)
Industrylegal insurance
Founded1972
HeadquartersAda, Oklahoma
Key people
Harland Stonecipher (founder, chairman)
ProductsLegal services, Identity theft restoration
Revenue$461M
Number of employees
813 Full Time
Websitehttp://www.prepaidlegal.com

Pre-Paid Legal Services, Inc. (NYSE: PPD) is a corporation that offers specialized legal service products in the United States and Canada. The firm was founded on August 8, 1972, and made its initial public offering in 1984. Pre-Paid Legal Services, Inc. is a member of the S&P 600 SmallCap index and the S&P 1500 Super Comp index.

Company description

Pre-Paid Legal Services, Inc. develops, and markets pre-paid legal services plans through a network of more than 50 independent provider law firms across the U.S. and Canada. The Company also markets an identity theft monitoring and restoration services through its partnership with Kroll Inc..[1] Currently most of the company's products are sold through direct commission based marketing plans. Products are also sold as an employee benefit through payroll deduction. The company has legal service plans for Small Businesses as well in partnership with NFL Hall of Fame player Fran Tarkenton.

Subsidiaries

Today, Pre-Paid Legal Services, Inc. has its headquarters in Ada, Oklahoma, in the same town that the Founder, Harland C. Stonecipher was born. The company owns several subsidiaries. Pre-Paid Legal Casualty, Inc. operates in Alabama, Arizona, Arkansas, Georgia, Illinois, Montana, Nebraska, Tennessee, & Wisconsin. There are 3 subsidiaries that serve individual states: Pre-Paid Legal Services, Inc. of Florida, National Pre-Paid Legal Services of Mississippi,Inc. and Legal Service Plans of Virginia, Inc. PPL Legal Care of Canada Corporation operates in the Country of Canada.

History

Pre-Paid Legal Headquarters

On July 11, 1969, former CEO and founder Harland C. Stonecipher was involved in a motor vehicle accident and was hospitalized. Although the other party was cited for fault, they had filed a suit against him for the accident.[2] He hired a lawyer to defend himself in court, but in doing so, depleted his life savings. After researching the industry of European legal expense plans, Stonecipher created Pre-Paid Legal’s predecessor, The Sportsman’s Motor Club, on August 8, 1972. The club offered legal expense reimbursement to its members. Pre-Paid Legal began utilizing network marketing in 1983. Pre-Paid Legal went public on the NASDAQ National Market System in 1984, and is currently listed on the B=New York Stock Exchange.[3]

In 2001, the Wyoming Attorney General issued a press release announcing "When we discovered that Pre-Paid was using prohibited income representations to promote their multilevel marketing program, we warned them that the representations were prohibited by Wyoming law”. Pre-Paid paid $4000 in lieu of civil penalties, reimbursed the state for $1000 in costs, and refunded $2000 to participants who claimed to have been misled.[4][5]

Pre-Paid Legal has faced ongoing troubles in Missouri. After the company settled complaints in 2001, a number of similar suits arose. The company won in a jury trial against two plaintiffs,[6] but later settled with more than 400 others, including one customer who was awarded $9.9 million. The company, and the U.S. Chamber of Commerce of which Pre-Paid Legal CEO Harland Stonecipher is a director,[7] have described the lawsuits against the company as "frivolous" and "abusive".[8]

Pre-Paid Legal reported to the SEC that under 25% of its sales representatives sold more than one insurance plan in 2005, but avoids reporting such information to prospective sales representatives.[9] The same article, from the New York Times, reported that in 2005 a Mississippi jury awarded a Pre-Paid customer $9.9 million over claims of deceptive marketing.

In October 2009, Tulsa World reported that Pre-Paid Legal have been subpoenaed by the SEC for various documents including those pertaining to a stock repurchase program that Pre-Paid has had since April 1999. (In 2006, the company said it would repurchase $27.4 million of shares owned by executives.)[9] The SEC reported that thus far it is a "fact finding" mission.[10]

On November 19, 2009, Pre-Paid Legal announced that it received a complaint from the Federal Trade Commission. The proposed draft complaint alleged that Pre-Paid's "ADRS program and related materials violate Section 5(a) of the FTC Act regarding asserted misleading representations, express or implied."[11][12]

Forbes Magazine again in November of 2010 ranked Pre-Paid Legal Services as number 68 out of the 100 best companies in America.

References

  1. ^ "Pre-Paid Legal Services To Add Identity Theft Benefits Provided By Kroll Background America". kroll.com. Retrieved 2010-03-07.
  2. ^ "Pre-Paid Legal Services, Inc. | Executive Bios". prepaidlegal.com. Retrieved 2010-03-07.
  3. ^ "Pre-Paid Legal Services, Inc. | The Pre-Paid Legal Story". prepaidlegal.com. Retrieved 2010-03-07.
  4. ^ Bernick Jr, Bob (2008-10-30). "Shurtleff's fundraising trounces Hill's | Deseret News (Salt Lake City) Newspaper | Find Articles at BNET". Findarticles.com. Retrieved 2009-10-23.
  5. ^ "newell letter" (PDF). Retrieved 2009-10-23.
  6. ^ By Melissa Davis (2004-10-20). "Pre-Paid Prevails in Mississippi Case | Melissa Davis | Financial Articles & Investing News". TheStreet.com. Retrieved 2009-10-23.
  7. ^ "U.S. Chamber of Commerce - June 27 - U.S Chamber Reappoints Harland Stonecipher, CEO of Pre-Paid Legal Services, to Board of Directors". Uschamber.com. 2005-06-27. Retrieved 2009-10-23.
  8. ^ "U.S. Chamber of Commerce - Nov 24 - Chamber Joins Miss. Case against Frivolous Lawsuits Pre-Paid Legal Services Targeted Improperly". Uschamber.com. 2004-11-24. Retrieved 2009-10-23.
  9. ^ a b DUHIGG, CHARLES (November 13, 2006). "Why Short Sellers Want to Crash the Tupperware Party". The New York Times. Retrieved 2009-10-24.
  10. ^ "SEC asks Pre-Paid Legal for documents". Tulsa World. Retrieved 2009-10-23.
  11. ^ "Pre-Paid Legal Services Announces FTC Developments". Pre-Paid Legal Services date=. Retrieved 2009-11-19. {{cite web}}: Missing pipe in: |publisher= (help)
  12. ^ "Pre-Paid Legal (PPD) Received Draft Complaint from FTC Relating to ITSADRS Program". StreetInsider.com. 2009-11-19. Retrieved 2010-09-26.
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